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AgMag BLOG

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Tepid Tea for Corn Ethanol Subsidy Backers

Monday, November 29, 2010

Tea party backers, environmental groups, faith-based organizations, and the bulk of the U.S. meat and dairy industry joined forces today, calling on Congressional leaders to eliminate a wasteful taxpayer-funded subsidy that largely lines the pockets of companies that blend ethanol with fuel, including BP, Shell and Chevron. Go here to read the letter asking Congress to roll back support for corn ethanol from 59 groups.

Al Gore made news last week in public comments condemning the feasibility of corn ethanol and detailing how his previous support for the environmentally damaging fuel was based solely on the political calculation that is the Iowa presidential caucuses. So basically the only folks who think that federal support for corn ethanol is still a good idea, is the endless feedback loop of the ethanol lobby and their dwindling number of patrons in Congress.

Lawmakers are back in Washington, D.C. for the lame duck session of the current Congress and are expected to consider the fate of the Volumetric Ethanol Excise Tax Credit, or VEETC, which gives corporate ethanol and oil interests over $6 billion in federal dollars each year regardless of the price of ethanol or how large their profits are.

In the 30 plus years since the ethanol industry got off the ground, its lobbies have defended the tax credit by stressing among other things, the positive local economic benefits of ethanol production and plant ownership, claiming it was family farms that would mostly benefit from VEETC. Eight years ago, farmers owned more than 40 percent of all ethanol plants; today their share is just 19 percent and a scant 16 percent of corn ethanol is produced by farmer-owned plants.

“At a time of spiraling deficits, we do not believe Congress should continue subsidizing gasoline refiners for something that they are already required to do by the Renewable Fuels Standard,” the disparate group of 59 groups wrote to House Speaker Nancy Pelosi (D-Calif), Minority Leader John Boehner (R-Oh), Senate Majority Leader Harry Reid (D-NV) and Senate Minority Leader Mitch McConnell (R-KY).

“Sending billions in taxpayer dollars into the bank accounts of some of the world’s richest corporations at a time when millions are out of work, and worried about how they’ll keep afloat and feed their families is outrageous,” added Environmental Working Group senior vice-president Craig Cox from EWG’s Ames, IA office.

 

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